A copper smuggling ring in Costa Rica was stealing tons of the metal from the country's electrical and phone wires to send to Asia, the latest example of how this crime is gradually becoming increasingly sophisticated.
On March 29, Costa Rican authorities carried out raids across various cities, arrested 18 people, including the alleged ringleader, a Taiwanese national who had lived in Costa Rica, reported newspaper La Nación. The total weight of the recovered copper surpassed 1,500 kilograms.
The modus operandi of the organization involved several steps. According to La Nación, one segment of the organization undertook cable theft and transportation to a collection center outside the capital city, San José. The copper was then extracted, processed and packaged into bales for transportation on cargo ships.
The group was able to export more than 70 containers with 20 tons of copper each, reaching a value of more than $210,000 per unit. The alleged destinations for the products included China, Japan, Malaysia, Hong Kong and Indonesia.
SEE ALSO: Coverage of Costa Rica
Most of the copper recovered in the operation belonged to the Costa Rican Institute of Electricity (ICE), according to a press release from the state-owned electricity provider. Apart from the financial losses accrued by providers, copper robbery has left hundreds of thousands of people without electricity and phone services, OIJ director Walter Espinoza explained to reporters.
Costa Rica differs from its South American neighbors as it has no domestic copper processing companies or plants, according to La Nación. Nonetheless, Costa Rica has seen an uptick in cable theft over the past few years. In 2020, losses totaled almost $2 million from cable theft and hundreds of kilometers of telephone wires were rendered useless in 2021, according to ICE.
Costa Rica authorities have previously sounded alarm bells about gangs robbing copper for export to Asia, and the most recent bust all but confirms their concerns.
InSight Crime Analysis
Copper theft has plagued Latin America for decades, but organized procurement and distribution networks to steal and export copper have grown to an enterprise-scale in recent years.
In Costa Rica, the groups dedicated to copper theft have begun to dress up as technicians, driving falsely labeled ICE trucks and wearing similar clothing to avoid suspicion. Thieves even forge official permits to assuage the concerns of neighbors and businesses. In the most recent bust, officials discovered large-scale copper extraction and packaging operations, indicating that criminals were becoming more creative with robbery and had increased the quantity of copper they were moving.
Increased demand for copper has fueled the illicit trade of the metal. Whereas a kilogram of copper sells for about $6 domestically, the payout is much higher in Asian countries. And despite an initial drop in copper demand at the beginning of the pandemic, global prices have since steadily increased and reached an all-time high in March 2022. The lucrative market encourages a level of organization and logistics above those of petty street thieves.
However, copper theft has become more sophisticated in Costa Rica and across the region. In recent years, Chilean authorities have discovered a series of large-scale illicit copper shipments at its ports. The most recent happened in February 2022, when authorities found 12 tons of copper headed for South Korea. There have been dozens of coordinated robberies on trains carrying tons of copper in remote parts of Chile.
Argentina and Uruguay have also experienced massive spikes in copper cable theft from electricity and telecommunications infrastructure. Large-scale organized theft is beginning to characterize typical copper robbery in the countries, such as 300 Argentines participating in the mass extraction of underground telephone wire.
Even in Colombia, companies reported millions of dollars lost in revenue due to the theft of network infrastructures like copper tubes, cables, and lids. El Nuevo Siglo reported that multi-prong criminal networks were dismantling wiring across neighborhoods in Bogota and then transporting it for scrap.
The Costa Rica case underscores the increased sophistication of copper theft throughout Latin America. If copper prices remain high globally, the illicit market for the metal is unlikely to shrink.